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Projects execution: FG yet to defray Lagos over N50 Bn expenses

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By Olasunkanmi Akoni

President Muhammadu Buhari has sought the approval of the National Assembly to pay Kogi State N10 billion for projects executed in the state on behalf of the Federal Government.

Projects execution: FG yet to defray Lagos over N50 Bn expenses

In reference to the above moves, Lagos State deserves to be given priority attention in a refund of FG’s projects executed by the state government.

It was gathered that FG is owing Lagos State Government about N50 billion on projects executed on behalf of Lagos State Government.

In contrast, a source told Vanguard on good authority that immediate past Governor, Akinwunmi Ambode allegedly, collected N45 billion towards the end of his administration from FG as a refund for the execution of federal projects in the state.

However, efforts to get the current and actual amount being owed Lagos at press time were unsuccessful as both Commissioners for Information and Strategy, Gbenga Omotoso and Finance, Rabiu Onaolapo, could not respond to Vanguard’s request on the current debt owed Lagos State Government by FG.

Recall that Ambode, while presenting a budget proposal of N662. 588 billion for the 2016 fiscal year to Lagos State House Assembly for consideration and subsequent approval, urged the federal government to accord Lagos a Special Status that it deserves as soon as possible.

Ambode said, “Federal Government still owes Lagos State over N50 billion expended on federal roads. We look forward to an early refund to enable us utilize the fund on other infrastructure that required attention.”

Some of the prominent federal roads which the state government undertook, Lagos-Abeokuta Expressway, 10 lane Osjodi-Murtala Muhammadu International Airport, MMIA, Road, Lagos- Badagry Expressway, among others.

But unlike in other places, transparency in projects, contract awards, and their financing is still an alien concept. For instance, there is no official disclosure yet on the cost of the Oshodi-Lagos Airport road rehabilitation and expansion, beyond estimates of about N50 billion to N60 billion. Ditto for the Transport Interchange, which might have cost the state government N22.4 billion ($70 million).

More so, these are projects that are not in the State’s Appropriation Law of 2017 or 2018. Ambode, however, offers a clue on their financing.

At the projects’ inauguration, Ambode disclosed that his administration invested into the two projects the second tranche of the Paris Club refund, in addition to the Federal Government’s refund on the backlog of federal road rehabilitations executed by states.

The first tranche of the Paris Club refund to states was utilised to pay the 40 per cent down-payment for the 820 buses.

It was not clear how much of a refund Lagos State got from the FG for federal road projects undertaken, though the debt was already in excess of N50 billion at the twilight of the Fashola’s administration.

That aside, details released by the Federal Government showed that Lagos has received as much as N25 billion as Paris Club Refund. Paris Club refund is a partial settlement of long-standing claims by state governments relating to over-deductions from their federation account allocation committee (FAAC) allocation for external debt service arising between 1995 and 2002.

The Ministry of Finance’s breakdown of 2016 payment of a total of N516. 4 billion to 36 states showed that Lagos got N16.74 billion in the first tranche. In the second tranche, Lagos got a pie of N8.37 billion out of the N243.8 billion largesse.

So, how much of N16.74 billion was sunk into the 40 per cent down payment of 820 buses? Again, how much of the over N50 billion FG’s refund plus N8.37 billion Paris Club refund went into the Oshodi and Airport Road projects,? yet to be clarified.

The then state Commissioner for Finance, Akinyemi Ashade, when reached could not give instant answers which left most of the issues begging for clarification.


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